Of all the investments made by the super-wealthy partners at Bain Capital, perhaps none have a greater potential return than the one they have made in Mitt Romney.
Current and former Bain executives and their relatives have given about $4.7 million to organizations dedicated to making Romney the next president of the United States, according to a Center for Public Integrity investigation.
And they haven't just come around lately.
Some Bain associates have been filling Romney's campaign coffers since 2004 when the former Massachusetts governor had early aspirations to become president, and long before he officially embarked on a run.
Since then, they have given to political committees in early primary states -- some without contribution limits -- to both of Romney's presidential campaigns and to federal "leadership PACs" controlled by the candidate.
Most dramatically, they gave at least $3.1 million in 2011 to "Restore Our Future," a "super PAC" not controlled by Romney, which has used the contributions to launch ads attacking candidates Newt Gingrich and Rick Santorum.
The state-level contributions have at times gone to local officials, like South Carolina Gov. Nikki Haley, who received $62,500 from Romney-connected state and federal PACs, and who endorsed him in the South Carolina primary.
But a greater percentage of funds raised at the state level went to promoting Romney's presidential runs, something that has prompted legal challenges by Democratic groups.
The Center examined contribution data from the Center for Responsive Politics, CQMoneyline, the Federal Election Commission and state campaign finance regulators. (Contributions made from 2004 to 2007 to the South Carolina PAC were not available.)
Giving early and often
Current and former Bain executives gave early and often when Romney supporters established one federal and six state-based leadership political action committees -- each dubbed "Commonwealth PAC" -- in 2004 and 2006. By having the PACs, Romney raised almost 10 times more money per contributor than he could have through his presidential campaigns alone.
Leadership PACs are typically created by candidates to raise money to contribute to other candidates' campaigns and advance the agenda of a political party. Campaign finance experts say, however, that these organizations are loosely regulated and have wide latitude on how they can spend their funds.
The PACs allowed Romney to raise money during non-election years when he was not officially a candidate for president. Much of the Commonwealth money came from 16 current or former Bain executives and their wives, some of whom contributed tens of thousands of dollars in a single day to multiple PACs.
Bain Capital has more than a rooting interest in Romney.
Records show the company spent more than $3.1 million from 2007 through 2011 for lobbying on issues from regulatory oversight of the financial industry to tax benefits for rich investors to investment in U.S. companies from China.
Bain Capital LLC is a Boston-based private equity firm, founded in 1984 by Romney and other partners of the consulting firm Bain & Co. Bain & Co. was founded by William Bain in 1973. Romney worked for both Bain Capital and Bain & Co., which are separate entities. Five of the 16 contributing executives worked at Bain & Co. while the rest worked at Bain Capital.
Bain Capital specializes in leveraged buyouts and investment in a variety of ventures, including office supply stores, a pizza chain and a contact lens retailer.
During the 14 years Romney headed Bain Capital, the average annual rate of return on the firm's investments was 88 percent. Bain now manages about $60 billion in assets.
Although Romney left Bain Capital in 1998 and took over management of the debt-ridden 2002 Winter Olympics, he continued to receive a share of Bain's profits, providing him millions of dollars in income each year. In addition to personally financing some of his elections, he also parlayed his Bain connections to fund his Commonwealth PACs and subsequent campaign organizations.
Romney made the first moves to run for president in 2003, barely six months into his Massachusetts governorship. The Boston Globe has reported that long-time Bain associate Robert White met with Republican operatives in Washington, D.C., to discuss Romney's potential candidacy. White, who headed Romney's gubernatorial transition team, had worked with Romney on his unsuccessful 1994 campaign for U.S. Senate and the Salt Lake City Organizing Committee for the Olympic Winter Games of 2002.
By the summer of 2004, Romney supporters had established a federal Commonwealth PAC and four state Commonwealth PACs in Arizona, Iowa, Michigan and South Carolina. Once the PACs were set up, the Bain funds started pouring in.
- In a single day in August 2004, White signed checks for $21,500 to four PACs. White and his wife eventually gave at least $83,000 to the PACs.
- Another Bain executive, Paul Edgerley, wrote checks worth $21,500 in a single September 2004 day for four PACs. He and his wife eventually contributed at least $68,000 to the PACs.
- William Bain contributed $7,000 in one day in 2004 to two state PACs, and he and his wife eventually contributed at least $43,000 to the PACs.
Meanwhile, Romney was traveling the country to promote his new book and raise money for President George W. Bush and the Republican Governors Association, of which Romney was president. He also spoke at the Republican National Convention.
By 2006, Romney announced he was not seeking re-election for governor and was considering a presidential bid.
More Commonwealth PACs were established in New Hampshire and Alabama and 2006 became the year for the largest amount of contributions to the PACs, especially in Michigan and Iowa. In a single week in 2006, former Bain executive Fraser Bullock and his wife gave $43,000 to four Commonwealth PACs.
Meg Whitman, a former Romney protégé at Bain & Co. who eventually ran unsuccessfully for California governor in 2010, contributed $96,500 to four PACS in two days in November 2006.
A spokeswoman for Whitman said Whitman's contributions are disclosed and well documented as required by law and that Whitman had no comment. Other Bain executives did not return phone calls.
Profits, donations rise
The fundraising did not just stop at Bain's door. Other businessmen who worked with Bain also gave thousands of dollars to the Commonwealth PACs, steadily increasing their donations as their businesses flourished.
For example, Thomas Stemberg received $3 million from Bain in 1986 to fund a business that included a single office supply store and grew to become Staples Inc. By 2006, when Staples had 1,700 stores, Stemberg and his wife contributed at least $39,000 to four Commonwealth PACs. Stemberg is now with Highland Capital, a company whose managing partner joined with a Bain managing partner to buy the Boston Celtics basketball team. Stemberg and his wife eventually contributed a total of at least $90,000 to the PACs.
In another instance, Peter Karmanos Jr., executive chairman of Compuware Corp., a Detroit-based company that Bain considered acquiring but declined in 2007, contributed $246,500 in a two-week period in 2006 to four Commonwealth PACs. A month after one of those contributions landed at the Michigan PAC, Karmanos became a member of its steering committee. Scott Romney, Mitt Romney's brother, sits on the Compuware Board of Directors.
Last summer, Compuware bought a software company that Bain had backed since 2005. A Compuware spokesman said Karmanos "likes the fact that Romney compromises, and he was able, as a Republican, to pass things such as health care in the most liberal state in the union because he could work with Ted Kennedy and other Democrats." The spokesman said Karmanos will support Romney again in 2012, and is waiting to see what financial support Romney will need.
Once Romney officially declared his candidacy in 2007, the PACs went dormant and more than 85 other contributors who listed Bain as their employer contributed about $188,000 to Romney's official campaign.
Federal contribution limits were $2,300 per person, per election. Romney lost to John McCain in 2008, and immediately threw his support behind the Arizona senator. But Romney was already gearing up for another run and the Commonwealth PACs, reinvigorated and renamed Free and Strong America, once again had donations flowing into their coffers.
In 2010, Edward Conard, a former managing director at Bain Capital who had donated tens of thousands of dollars to the PACs from 2004 to 2006, contributed another $100,000 in a single day to six Romney PACs.
Other donors with Bain connections also contributed large amounts to the PACs. For example, two executives with Sun Capital, a Boca Raton, Fla., investment firm that Romney and Bain joined in company ventures, donated a combined $100,000 to six PACs in a two-week period in 2010.
The Romney campaign declined to comment on the Bain contributions and referred questions to the PACs, which became separate from the campaign once Romney officially declared his candidacy.
Representatives of the PACs did not return calls. But campaign officials have said in past media interviews that the Commonwealth PACs followed the "spirit and the letter" of election laws and the PACs were created to allow Romney to campaign for and contribute to other Republican candidates and present his ideas when he is not running for president.
Many candidates and elected officials establish PACs, but few were as prolific, especially at the state level, as Romney's. In total, current and former Bain executives and their relatives contributed more than $1 million to the state and federal Commonwealth and Free and Strong PACs from 2004 to 2011.
"The use of state committees and federal leadership PACs to lay the foundation of a presidential run by Romney and other candidates is troubling because it's an obvious tactic to evade the [contribution] limits applicable to candidates for federal offices," said Paul Ryan, an attorney for the Campaign Legal Center.
Among Romney's greatest supporters is a committee with which he's not even allowed to communicate.
The era of the 'super PAC'
Restore Our Future was created in 2011 by Romney supporters as a "super PAC" and, through the end of January, has spent $17.3 million, nearly all of it on advertising against primary opponent Gingrich. By law, the super PAC cannot coordinate with Romney or his campaign, yet Restore Our Future provided yet another vehicle for current and former Bain executives to show their financial support.
Conard has contributed at least $1 million to Restore Our Future, though initially the donation was masked through a shell corporation before Conard stepped forward. Edgerley and his wife also contributed at least $1 million. Stephen Zide, a Bain managing director, contributed at least $250,000 and David Bullock, the son of Fraser Bullock, contributed at least $100,000.
In the most recent disclosures of Restore Our Future contributions released last week, three additional Bain executives and one executive's wife contributed $750,000.
In addition, the same two Sun Capital executives who contributed to the state PACs, Rodger Krouse and Marc Leder, also contributed $125,000 each to Restore Our Future in June 2011. Krouse, Leder and their wives also contributed a combined total of at least $19,000 to Romney's 2008 and 2012 campaigns. A spokesman for the two Sun Capital executives declined to comment.
Stemberg contributed at least $10,000 to Restore Our Future, and he and his wife contributed the maximum $5,000 allowed in 2011 to Romney's campaign. Stemberg did not return calls requesting comment.
For the thrifty Bain executives, there's still the traditional method of contributing directly to Romney's campaign. For 2012, the limit is $2,500 per person, per election. In 2011, over 95 contributors who listed Bain as their employer had contributed a total of about $221,000.
A spokesman for Bain Capital declined to comment on any of the contributions to Romney organizations.
The company is politically astute enough not to put all of its contributions in one party basket.
For years, Bain entities have also contributed to Democratic candidates at the state and federal level, including contributions to the Senate races of John Kerry, D-Mass., and Hillary Clinton, D-N.Y. But in both the 2008 and 2012 presidential election, Bain entities contributed far more to Romney than to President Barack Obama.
Unlike 2008, when Romney's Bain connections were not a focus of the campaign, his tenure with the company has drawn intense scrutiny as his rivals question Romney's claims that Bain Capital created more jobs than it destroyed as it specialized in leveraged buyouts of companies.
Questions about taxes paid by executives at private equity firms like Bain have also arisen. Among Bain's lobbying interests was legislation that would treat "carried interest" as taxable income.
Currently, carried interest -- the share of profits paid to private equity managers -- is taxed at a lower rate than regular income and this lower rate has been criticized as a benefit for investment firms like Bain. Bain Capital was a member of the Private Equity Council, which in 2010 opposed legislation to change the tax treatment of carried interest.
Romney, after tremendous pressure from both Republicans and Democrats, recently released his 2010 and 2011 tax returns. They show he paid a little less than 15 percent in taxes, a low rate for his $42 million total income for the two years.
About $13 million was from carried interest on Bain investments.
John Dunbar contributed to this report.